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ECONOMIC REFORM CARETAKER GOVT’S TOP PRIORITY, SAYS PM KAKAR
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Wednesday, 16 August, 2023 I 28 Muharram, 1445
VOWS GOVT WOULD ENSURE PROVISION OF INT’L QUALITY FACILITIES IN HEALTH, EDUCATION SECTORS
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ISLAMABAD
TO CONCENTRATE ON DEREGULATION, RESPONSIBLE AUTONOMY TO FURTHER IMPROVE ECONOMY
STAFF REPORT
ARETAKER Prime Minister Anwaar-ul-Haq Kakar on Tuesday said that the government would ensure bringing in economic reforms, continuity of the economic policies, besides further improving them. He said that further enhancement of foreign investment under the Special Investment Facilitation Council (SIFC) was among the top priorities of the caretaker setup. The prime minister chaired a meeting in which he was given a detailed briefing over the economic situation, PM Office Media Wing said. During the meeting, the prime minister said that work on the public welfare projects would continue and the government would ensure provision of international quality facilities in the health and education sectors. He also directed for expediting ongoing reforms in the power sector and strict implementation of measures for increasing tax revenues. Prime Minister Kakar said that the caretaker government would concentrate on deregulation and responsible autonomy for further improvement of the economy and expressed the resolve to focus their energies on economic reforms during their tenure. The meeting was attended by senior officials including governor State Bank of Pakistan, secretaries Finance Division and Power and chairman Federal Board of
Revenue (FBR). The meeting was briefed over the steps taken for bringing further improvement and stability in the economy. A detailed briefing was also given over the reforms in the power sector. The caretaker prime minister directed for submission of detailed reports regarding ongoing reforms in all sectors. Kakar took charge as the caretaker prime minister a day earlier after he was administered oath by President Arif Alvi. He was named as the interim PM after his predecessor, Shehbaz Sharif, and former opposition leader in the National Assembly Raja Riaz agreed to propose Kakar for the coveted slot. The officials briefed Kakar in detail about the measures being taken to bring about stability and a further improvement
CJP stresses ECP should conduct delimitations transparently ISLAMABAD
in the country’s economy, the ongoing reforms in the power sector “Will maintain continuity in country’s economic policies and bring more economic improvement,” he assured. Interim PM Kakar added that public welfare projects will continue uninterrupted during his government and directed that international standard facilities should be ensured in the health and education sectors. The caretaker premier also added that his government would prioritise steps to increase foreign investment via the Special Investment Facilitation Council (SIFC). Kakar also added that his government would accelerate the implementation of ongoing reforms in the power sector. While measures to increase tax revenue
Chief Justice of Pakistan (CJP) Umar Ata Bandial said on Tuesday that the Election Commission of Pakistan (ECP) should conduct the process of delimitations transparently, stressing that it was a “matter of public interest”. The top judge passed these remarks as a twomember Supreme Court (SC) bench, comprising Justice Bandial and Justice Sayyed Mazahar Ali Akbar Naqvi, took up a petition pertaining to errors and illegalities in the delimitation for PS-07, PS-08 and PS-09 of Sindh’s Shikarpur district. After the final results of the first-ever digital census were approved earlier this month, the ECP is now expected to conduct fresh delimitation of constituencies. However, the electoral body had recently declared that conducting polls on fresh delimitation was not possible and that the exercise would require four to six months, making it almost certain that general elections may not be held this year. Meanwhile, a Dawn report published today said a huge mismatch in the otherwise increased and decreased share of districts across the country would make the upcoming exercise to re-draw boundaries for provincial assemblies’ elections a complex one. The report highlighted that a thorough analysis of population figures showed that unlike for National Assembly seats, fresh delimitation for the provincial assembly seats can affect dozens of districts. The delimitation issue was also brought up during the SC hearing today as the CJP remarked that the matter had come to the top court several times. If the tapedar (revenue official) modifies the dotted circles during the delimitation [process], it would affect votes of the candidates contesting from the constituencies, he said. “This is a matter of public interest.” The ECP, Justice Bandial stressed, should conduct delimitations transparently. “There is a lot of sensitivity on delimitations in Sindh,” he highlighted, adding that grievances regarding incorrect delimitations often came from the province.
should be strictly followed, he directed. “The caretaker government will focus on deregulation to improve the economy.” The caretaker prime minister also directed the officials to submit a detailed report on the ongoing reforms in each sector. FORMATION ON CABINET CARDS: Even though Kakar has given a hint of what lies on the economic front, his first task is to assemble a cabinet. Official sources told today that Kakar has sped up the consultation for the formation of the cabinet. They added that the interim PM has decided to form a small cabinet and personally review the profiles of all possible candidates. “I don’t want to put more burden on the country suffering from economic problems,” the caretaker prime minister told his friends, according to the sources. He further expressly wished that his protocol be kept to a minimum, adding that he did not want to incur unnecessary expenses nor make people suffer. Moreover, former information minister Muhammad Ali Durrani is likely to be given the portfolio of the Ministry of Information, the sources said. The sources also said that the names of caretaker ministers under consideration include former foreign secretary Jalil Abbas Jilani, former civil servant Shoaib Suddle, former Supreme Court Bar Association (SCBA) president Ahsan Bhoon, former senator Sarfaraz Ahmed Bugti, and former police IG and acclaimed columnist Zulfiqar Ahmad Cheema.
Timely, transparent polls ‘only’ top priority: Sindh CM-designate KARACHI
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Sindh Chief Minister-designate, Justice (Retd) Maqbool Baqar on Tuesday asserted that the primary duty of a caretaker government upon taking office was to ensure elections were conducted in a timely and transparent manner. “As I take on the role of head of the provincial government, the primary focus of the caretaker setup will be to facilitate prompt elections, providing the Election Commission of Pakistan (ECP) with any necessary assistance they require for this purpose,” Baqar told Dawn News. Baqar, a former judge of the Supreme Court, became the interim Sindh chief minister earlier today after Governor Kamran Tessori signed a summary for his appointment. In a social media post on X (previously Twitter) in the early hours of the day, Tessori shared a picture of the summary sent to him by former Sindh chief minister Murad Ali Shah, which he had signed, thereby approving the latter’s advice. The summary stated that after a “series of meetings” were held between Shah and the outgoing Leader of the Opposition in the now-dissolved Sindh Assembly, Rana Ansar, it had been agreed that Baqar would be designated the role of the caretaker chief minister. It requested that Baqar’s notification for the role be approved under Article 224(1a) (time of
election and by-election) of the Constitution. Sharing the signed summary, Tessori stated: “I have signed the summary for appointing justice (retired) Maqbool Baqir as the caretaker chief minister. I have approved for justice (retired) Maqbool Baqir to be made Sindh province’s caretaker chief minister under Article 224 (1a) of the Constitution.” MQM-P had confirmed a consensus was reached on the name of Baqar, whose name was primarily proposed by the treasury, and it was agreed upon by the opposition after a lengthy discussion within the party and with its allies. Speaking with Dawn News today, Baqar underscored the significant responsibility that comes with holding public office, expressing his dedication to fulfilling it effectively. Justice (r) Maqbool Baqar speaks to Dawn News. When asked about the possibility of the caretaker government conducting an accountability drive, Baqar clarified that the assumption that his office would be solely accountable-focused was unfounded. “Such reports are not true.” Nevertheless, he emphasised that a chief minister held the obligation to ensure all endeavours were conducted with integrity, encompassing both political and moral honesty. “While there’s no specific agenda to target individuals, corruption must be curbed in all forms.”
The former chief justice of the SHC asserted that he would never condone any form of misappropriation or corruption. “My entire approach is grounded in upholding the principles of law and justice.” Responding to a query regarding the cooperation of provincial governments with accountability institutions, the CM-designate stated that any provincial government not aiding accountability bodies would be tantamount to negligence in duty. Asked about his potential choices for members of the caretaker cabinet, Baqar noted that individuals in such positions would naturally desire individuals of integrity, dedication, and commitment who possess a genuine concern for the public’s welfare. “I am earnestly desirous [of having such individuals], and with the support of people’s prayers, I remain hopeful that we can achieve this,” the former SHC CJ added. Inquired about his approach in the event of election delays, Baqar stated that he had not received indications of such delays thus far. He, however, stressed that decisions regarding election scheduling fell under the purview of the ECP, emphasising that the caretaker government lacked the authority to make such determinations. Before the formal announcement from any side, Justice Baqar, who retired from the Supreme Court last year, appeared on a private TV channel to confirm his appointment.
Gap between interbank and open market narrows as rupee dips g
RATES DIFFERENCE NARROWED TO RS8.49, WHICH IS STILL HIGHER THAN IMF'S STIPULATION PROFIT
UROOJ IMRAN
The rupee fell against the US dollar in the interbank market on Tuesday, slightly bridging the gap between the rates in the interbank and open markets — the difference between which should not be more than 1.25 percent according to the country’s agreement with the International Monetary Fund (IMF). The fall in the value of the rupee came on the first day of the new interim government. The sudden fall coming immediately after Anwarul Haq Kakar took over as caretaker prime minister has raised questions regarding whether the interbank rate of the rupee was still being managed by the outgoing PDM government. Data provided by the State Bank of Pakistan (SBP) showed that the rupee lost Rs 3.02 per dollar to close at Rs 291.51 in the interbank market, down 1.05 percent from the previous close of Rs 288.49. According to Arif Habib Limited, this is the secondlowest level the rupee has fallen to since a record low of Rs 298.93 reached on May 11, 2023. Meanwhile, the rupee continued to trade above Rs 300 in the open market. This equates to a difference of Rs 8.49 or 2.91 percent. Under the terms of an agreement reached with the IMF for an economic bailout in June, the government has to adhere to a single market-determined rate in both the interbank and open markets, with a maximum difference of 1.25 percent. As the coalition government bowed out last week without the name of an interim prime minister being finalised, the rupee fell to Rs 302 per dollar in the open market, which analysts attributed to political uncertainty. At the same time, the rate in the interbank market on August 11 was Rs 288.49 — a difference of Rs 13.51. So, the rupee’s fall in the interbank market is an attempt to narrow that gap. Ismail Iqbal Securities’ Head of Research Fahad Rauf explained that the interbank market had come under pressure because of the open market being on the higher side as the IMF had stipulated the difference in rates could not exceed 1.25 percent for five consecutive business days. Besides this, the IMF also wanted the exchange rate to be market-determined, which means the government could not intervene to “manage” the rupee by imposing trade restrictions. Therefore, import restrictions had been lifted leading to a higher demand for the greenback, Sana Tawfik, a senior analyst at Arif Habib Limited, said. Rauf also said the increase in import payments after restrictions were lifted, and the resulting rise in demand, put pressure on the rupee.
Pakistan’s Large Scale Industry witnesses 10.26% overall decline in FY23
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IMPORT CURBS, DEVALUATION OF RUPEE, MONETARY TIGHTENING AND ECONOMIC SLOWDOWN SERVE AS MAIN REASONS PROFIT
BASIT MUNAWAR
In a sobering revelation, the Pakistan Bureau of Statistics (PBS) on Tuesday has reported a decline of 10.26 % in the output of the Large Scale Manufacturing Industry (LSMI) during the fiscal year 2022-23 (FY23), compared to the previous fiscal year (FY22). This marks a significant setback for the country’s industrial sector. According to the provisional Quantum Index numbers of the Large Scale Manufacturing Industries (QIM), the LSMI output exhibited a sharp decrease of 14.96 %for June 2023 when compared with the corresponding period in 2022. However, there was a minor glimmer of hope as the output increased by 0.98% when compared to May 2023. What is the Quantum Index for Large Scale Manufacturing? The Quantum Index of Manufacturing (QIM) measures the changes in production of Large Scale Manufacturing Industries
(LSMI) overtime, on a monthly as well as cumulative basis. The weights presently used for the QIM were derived from the Census of Manufacturing Industries (CMI) 2005-2006. The provisional quantum indices of Large Scale Manufacturing Industries (LSMI) for June 2023, based on the 201516 base year, are derived from data provided by various source agencies including OCAC, Ministry of Industries & Production, Ministry of Commerce, and Provincial Bureaus of Statistics (BoS). An overview of Financial Year 2022-23 A closer look at the factors influencing this downturn reveals that several key sectors bore the brunt of the decline. Notable contributors to the -10.26% drop include the food industry (-1.14), tobacco (-0.65), textile (-3.65), garments (2.79), petroleum products (-0.89), chemicals (-0.52), pharmaceuticals (-1.85), cement (-0.86), iron & steel products (-0.24), electrical equipment (-0.54), and automobiles (-2.21). Interestingly, while the production of
wearing apparel, furniture, and other manufacturing sectors such as football increased in FY23 compared to FY22, a decrease was observed in the production of food, tobacco, textile, coke & petroleum products, pharmaceuticals, chemicals, non-metallic mineral products, machinery and equipment, automobiles, and other transport equipment. In June 2023 there was a substantial year-on-year production decrease of 14.96% in Pakistan’s LSMI, with the index dropping to 112.21 from 131.95 in June 2022. On a month-on-month basis, there was a slight recovery, with the LSMI output increasing by 0.98% compared to May 2023. The cumulative data for FY23 as a whole paints a grim picture, with the LSMI output experiencing a 10.26% YoY decrease, reaching 114.83 compared to 127.96 in FY22. Numerous factors contributed to this downturn, including restrictions on imports, weak macroeconomic indicators, monetary tightening, supply chain disruptions, and an increase in energy costs. The country’s po-
litical instability has also played a role in constraining output growth. The decline in LSMI output is undoubtedly a formidable challenge for Pakistan’s
economy. This downturn emphasizes the critical need for sustained investment and support to resuscitate and fortify the country’s industrial sector.